First Stage of Desalination Plant at Tseung Kwan O

Industry Briefing 23 May 2017

Conditions for Participation in the Briefing and Viewing / Use of Information

• The Desalination Plant project is on-going and all information presented in this briefing (including all data and statements whether given in writing or verbally) are subject to change without notice.

• The information presented in this briefing shall not be taken as representation in relation to the tendering, design and construction of any contract works in relation to the desalination project.

• Neither the HKSAR Government nor its agents or representatives owe any duty of care or is otherwise liable to the participants or anybody in respect of any errors, omissions, discrepancies and/or deficiencies relating to any information presented in this briefing.

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Conditions for Participation in the Briefing and Viewing / Use of Information

• The participants of this briefing agree that, in future if he enters into a contract with the HKSAR Government to design and/or construct the Desalination Plant works, he will waive any claim or proceeding against the HKSAR Government, the consultants or any person/party associated, employed or retained by either of them, in relation to any information presented in this briefing and to any difference between the nature and/or extent of conditions encountered in the execution of any works included in the contract and that which is disclosed or implied by this briefing.

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Conditions for Participation in the Briefing and Viewing / Use of Information

• The HKSAR Government reserves ownership to all intellectual property rights to the information presented in this briefing. No such information shall be used without the written permission of Water Supplies Department (WSD).

• Further participation in this briefing shall represent acceptance of the above conditions.

• Any one who view or use the information presented in this briefing shall also be deemed to have accepted the above conditions.

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Agenda

• Introduction

• Project Overview

• Project Risks and Constraints

• Procurement Method

• Tendering

• Questions & Answers (45 minutes)

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Section 1: Introduction

Is Hong Kong a

WATER-SCARCE city?

Water Rationing in the 1960s

Diversification of Water Sources

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Section 2: Project Overview

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Roles of TKO Desalination Plant

Primary role

Secondary roles

• A climate-proof strategic facility to augment fresh water supply in the event of drought

• Enhance system-level resilience

• Augment fresh water supply in the event of short-term emergencies

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Operating Mode & Plant Output

• Operational flexibility to meet varying outputs

• Ability to ramp up production to design capacity within a short period (e.g., 24 hours)

• Periodic testing

• At least once every year to confirm readiness for operating at full capacity

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Overall Scheme

Desalination Plant in TKO Area 137

Outfall

Intake

Existing TKO FW Primary Service

Reservoir

Legend:

Current Project Scope

New Freshwater Main (by others)

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Project Information

• Core Technology

• Reverse Osmosis

• Phased Development

• Stage 1: 135MLD (The Project)

• Ultimate: 270MLD Total (in future)

• Both stages to be built within a 8ha site

• Stage 1 tentatively scheduled for commissioning by end of 2021

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The Site and Surroundings

Fill Bank

Country Park

Country Park

Landfill

Desalination Plant Site

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Environmental Permitting

• Environmental Permit (EP) granted in December 2015

• Approved EIA Report available at:

• https://www.tkodesal.hk

• Approval from the Environmental Protection Department is required for design changes

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Intake & Outfall

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Submarine Intake Pipeline

Submarine Outfall Pipeline

Outfall Diffusers

Intake Structure

Marine works authorised under the Foreshore and Sea-bed (Reclamations) Ordinance

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Mandatory Requirements

• Boron ≤ 1.0 mg/L

• Bromide ≤ 0.2 mg/L

• TDS < 250mg/L Fresh Water Quality

• Chlor-alkali process

• High-purity grade salt as feedstock

On-site Generation of Chorine Gas for

Final Disinfection

• Through a structured secondment programme

Operation & Maintenance Skill

Transfer

• Minimum Gold Rating BEAM Plus

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Other Requirements

• Must “blend in” with country park and future developments in TKO Area 137

Architectural Treatment

• Solar

• Landfill Gas

Use of Renewable

Energy

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Section 3: Risks and Constraints

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Seawater Quality

Red tide events could occur occasionally; plant output may be relaxed during such periods

Seawater quality parameters for which the plant must be able to operate to meet full performance requirements

Parameter Value

Temperature 15 to 30 0C

Total Suspended Solids ≤ 30 mg/L

Total Dissolved Solids ≤ 38,740 mg/L

Bromide ≤ 80 mg/L

Boron ≤ 5.3 mg/L

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Site Apportionment and Hand Over

Stage 1 site (Handover within 1st year)

Access Road

Stage 2 site (Handover within 2nd year )

Stage 1 site (Handover upon commencement)

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Construction Access

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Shared Access with the Existing Pier Operations (explosive handling by Mines Division of CEDD )

Desalination Contractor shall not hinder CEDD/Mines explosive transport

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Co-Use of Pier during Construction and Operation

• Use of pier subject to conditions imposed by CEDD/Mines

• No activities at pier between 11am and 1pm each day

• 3 days advanced notice on scheduled use of pier

• No stockpiling of plant and materials at the pier

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Influence Zone wrt loading /unloading of explosives by Mines Division

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Key Statutory Approvals

• Compliance with Fire Services Department’s

• Codes of Practice for “Minimum Fire Service Installations and Equipment” and “Inspection, Testing and Maintenance of Installations and Equipment”

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• Environmental Impact Assessment Ordinance (EIAO)

• Compliance with EP requirements

• Variations to Environmental Permit (VEP) for non-material changes

• Supplementary EIA for “material” changes

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Other Risks and Constraints

• Stringent requirements on importation of skilled labour

• Presence of plant species of conservation interest in the Clear Water Bay Country Park

• Presence of coral communities and fisheries resources

• Working in and around an operating “fill bank”

• Requirements on CO2 storage area

• Requirements on the footprint, location and construction programme of CLP (power supply company) substation

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Other Requirements

• Natural terrain hazards mitigation measures approved by GEO

• Building height limitation per Environmental Permit

• 90-day chemical storage for stage 1 plant

• Sizing of chlorine contact tank(s) per WSD requirements

• BIM with asset management

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Slope mitigation measures to follow detailed design provided by the Employer • Flexible barrier • Rock dowels • Boulder removal

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Section 4: Procurement Method

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Proposed Project Delivery Model

• Time for Completion of Design/Build Phase

• 28 months + allowance for inclement weather

• Operations Term:

• 10 years (base)

• Additional optional extension of 5 years (at WSD’s sole discretion)

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Design

Build

Operate

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Proposed Commercial Model

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Contract Payments

Design Build Phase

Lump Sum, milestones

Operations Phase

Fixed Operating Costs

Variable Operating Costs

Asset Replacement

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Proposed Hybrid Operations Payment Model

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Op

erat

ion

s Pa

ymen

t Fixed Operating Charge

General ($/month)

Readiness ($/month)

Variable Operating Charge (production-

dependent)

Water Rate, excluding consumables ($/m3)

Target Cost for Consumables ($)

Periodic Asset Replacement Charge

$ per Asset Item

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Section 5: Tendering

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Pre-qualification

Start: October 2017* (Two months)

Shortlist

Up to 4 prequalified tenderers

Tendering

Start: February 2018*

(Six months)

Evaluation

Tender clarifications, if necessary

Contract Award

January 2019*

Tender Process and Tentative Timeline

* Date is tentative and if everything is smooth and is subject to relevant approval

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Stage 1 (Screening)

• Yes/No questions

• Minimum experience requirements of applicants

• Applicants not passing the screening criteria will not be further assessed

Stage 2 (Marking Scheme)

• Project experience

• Work methodology

• Proposed resources

• Past performance in local projects

• Top 4 applicants will be shortlisted

Prequalification Process

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Screening Criterion 1 (tentative, subject to change)

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PR

EQU

ALI

FIC

ATI

ON

• One or more “equivalent relevant” contract for design and construction of SWRO desalination facility(ies)

• Design capacity ≥ 50 MLD; AND

• Design and construction part of the contract completed within the past 10 years from PQ closing date or is currently being undertaken

• No. of past contracts will be discounted

• % financial participation in referenced contract, if undertaken as part of a JV

• % financial participation, if applicant is part of a JV for TKO

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Screening Criterion 2 (tentative, subject to change)

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PR

EQU

ALI

FIC

ATI

ON

• One or more equivalent relevant contract for operation and maintenance of SWRO desalination facility(ies)

• Design capacity ≥ 50 MLD; AND

• Operation and maintenance part of the contract has a continuous period ≥ 2 years carried out within the past 10 years from PQ closing date or is currently being undertaken

• No. of past contracts • Will not be counted if applicant has < 25% of financial

participation in the claimed contract experience

• Will be discounted according to % financial participation if applicant is part of a JV proposed for TKO

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Screening Criterion 3 (tentative, subject to change)

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PR

EQU

ALI

FIC

ATI

ON

• One or more equivalent local civil engineering and/or building contract

• Awarded contract sum ≥ HK$500 million

• Completed within the past 10 years from PQ closing date

• No. of past contracts to be discounted

• % financial participation in the referenced contract, if undertaken as part of a JV

• % financial participation, if applicant is part of a JV proposed for TKO

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Common Pitfalls P

REQ

UA

LIFI

CA

TIO

N • Misspelling of Contract Names and Personnel

• Inconsistencies in submitted documentations

• Uncertified documents

• Incorrect Dates

Uncertified documentation will be disregarded Inconsistent / insufficient information may be disregarded

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Tender Evaluation

• Two-envelope system

• Technical Proposal will be evaluated and finalised, prior to reviewing the Fee Proposal

• Weighting of Proposals, to be determined

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Fee Weighting

Technical Weighting

50% to

60%

50% to

40%

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Typical Tender Marking Scheme

Refer to “Administrative Procedures 2015 for Use with the Government of the Hong Kong Special Administrative Region General Conditions of Contract for Design and Build Contracts 1999 Edition”

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Section 6: Questions & Answers

https://www.tkodesal.hk/

THANK YOU